At a press conference, the German Sawmill and Wood Industry Association (DeSH) presented the results of a survey on current economic developments and possible future problems. More than 100 companies from the sector took part in the survey, and its results indicate that the industry is facing considerable difficulties. The weak economy and the housing construction crisis are placing enormous pressure on companies, while at the same time the implementation of the European Union's Deforestation Regulation (EUDR) threatens to disrupt timber markets and weaken the domestic wood industry. DeSH is calling for swift, active and decisive political action.
The association's leadership is demanding concrete steps to improve the situation. "The results of the survey not only provide an insight into the current situation in sawmills and the wood industry, but also underline the calls that have been heard throughout the German economy for months now: 'Without decisive political action there will be no swift economic recovery!'," stressed DeSH President Dr Stephan Lang (Dr. Stephan Lang).
"In the construction sector in particular, the crisis continues to deepen. The central part of the forest and timber value chain – the wood industry and the timber products industry – is under pressure. What is more, our sector is future-oriented: it underpins the development of a sustainable and climate-friendly construction industry. Given this worrying course of events, the political measures taken so far look like a 'drop in the ocean'."
The construction crisis is causing a shortage of orders
Of the 105 companies surveyed, roughly three quarters consider stagnation in the construction sector to be the biggest economic obstacle to the development of the wood industry in Germany. "The decline in construction activity, which has now been going on for several months, has had a profound effect on the sector. Already 40% of companies report poor business conditions – and no improvement is in sight," the association's president says of the survey results.
"Given record-high raw material and labour costs, companies are facing an extremely difficult market environment, particularly in comparison with what is happening on international markets."
Economic disruption caused by the EUDR
On top of this, the bureaucratic burden will increase sharply, and the planned introduction of the EUDR at the end of the year in particular creates significant economic risks. In fact, 94% of companies state that under current conditions they are unable to implement the regulation by the set deadline.
"The survey underlines what we as an association have been pointing out for months: the EUDR in its current form is neither feasible nor practical. Instead, it threatens to disrupt timber markets and to weaken the domestic industry over the long term," explains DeSH Managing Director Julia Möbus. In addition to the many unresolved questions and the lack of technical requirements, more than three quarters of companies fear unfavourable competitive conditions in international trade. Competitiveness problems are also expected in relation to manufacturers of non-wood construction materials, who face no such situation.
Urgent action is needed
"There is no doubt that wood is a resource of the future. An industry that produces environmentally friendly materials plays, and will continue to play, a decisive role in the sustainable development of both the economy and society. Instead of more bureaucracy, what we need are stable framework conditions and the removal of the existing barriers to the use of wood," notes Stephan Lang. "Given the current economic situation and the housing construction crisis, we call on the German government to act quickly. Waiting and merely hoping for improvement will not deliver climate-friendly change," S. Lang concludes.